ECommerce: Electronic Marketing and the Internet for Dot.com and BrickandMortar Marketers

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Chapter 4

• E-Commerce Electronic Marketing and the Internet
  for Dot.com and Brick-and-Mortar Marketers

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Chapter Objectives

• Define e-commerce and give examples of each
  function of the Internet.
• Describe how marketers use the Internet to
  achieve their firms objectives.
• Explain how online marketing benefits
  organizations, marketers, and consumers.
• Explain how marketers use interactive tools as
  part of their online marketing strategies.
• Discuss how an effective Web site can enhance
  customer relationships.
• Describe how to measure the effectiveness of
  online marketing efforts.

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What is Electronic Commerce?

• Electronic commerce (e-commerce) is targeting
  customers by collecting and analyzing business
  information, conducting customer transactions,
  and maintaining online relationships with
  customers by means of telecommunications
  networks.
• Electronic marketing (E-marketing) is the
  strategic process of creating, distributing,
  promoting, and pricing goods and services to a
  target market over the Internet or through
  digital tools.
• Digital tools include Fax machines, Computer
  modems, Telephones, CD-ROMs.

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• Mondera.com
• An online retailer targets buyers of fine jewelry

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BabyGapTraditional store outlets and the Internet
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• The Internet
• A global collection of computer networks linked
  together to exchange data and information
• Over 173 million U.S. users
• Intranets
• Internal organizational networks that allow those
  within an organization to communicate with each
  other and gain access to organizational
  information
• Extranets
• Organizational networks that allow communication
  between an organization and selected users
  outside the firm

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The World Wide Web -- A Typical Day on the Web
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E-Commerce and the Economy

• The fuel of the 21st century
• Changing the world
• A new universe
• Business-to-Business Online Marketing
• Involves professional buyers and sellers
• Requires less glitz and glamour
• Much more money involved than business-to-consumer
  online marketing

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• Benefits of Business-to-Business Online Marketing
• Finding new markets and customers
• Cost savings in every area of the marketing mix
• Time reduced in reaching markets

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• Roadway Express
• An example of an advertisement explaining
  Business-to-Business use of the Web

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• Online Consumer Marketing
• Lower Prices
• Bots (short for robots) programs that check
  hundreds of sites, gather and assemble
  information, and bring it back to the sender
• Convenience
• Worldwide access, Day or night, Customized
  products and information
• Personalization
• Improves the quality of the shopping experience
• Improves customer satisfaction

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Lands End Tailoring Products for Online
Consumers
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Determinants of Online Purchasing Behavior
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• Benefits of Online Consumer Marketing
• Relationship Building
• Crucial to success
• Onlines personalization helps
• Easier for small businesses with small budgets
• Customer service is the key
• Increased Efficiency
• Greater profit margins
• Educating customers online frees salespeople from
  answering routine questions

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• Cost Reductions
• Reduced start-up costs
• Reduced operating costs
• Frees funds for new marketing efforts
• A More Level Playing Field
• Even small firms with small budgets can compete
  in the global marketplace
• Helps eliminate discrimination and allow minority
  businesses to succeed on their own merits

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Who Are the Online Buyer and Sellers?

• Online buyers
• Annual household income of 30K-75K
• Live in urban areas
• 75 of employed people use the Internet at work
  87 of college students
• The next generation of online shoppers will be
  more representative of middle-class America
• Online sellers
• At first, offered familiar products like books
  and computer hardware
• Now offering a wider variety of goods including
  toys, groceries, and prescription drugs

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Creating an Effective Web Presence
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• Building an Effective Web Site
• Establish a Mission for the companys site
• Identify the purpose of the site
• Satisfy customer needs and wants through a clear
  site design
• Managing a Web Site
• Update the site frequently
• Flag new merchandise and services
• Ensure that site appears to be current
• Update software as needed
• Track costs and revenues

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• Boo.com
• Promoting its online sportswear electronic
  storefront
• An example of a website which had much fanfare
  but failed. They no longer exist. Must measure
  effectiveness